North west small business enter 2013 with cautious optimism, says Lloyds TSB

Small businesses in the north west say they are entering 2013 with a new found confidence, though that is unlikely to translate into investment and jobs in the next six months, according to a report out today.

Small businesses in the north west say they are entering 2013 with a new found confidence, though that is unlikely to translate into investment and jobs in the next six months, according to a report out today.

The Lloyds TSB Commercial Business in Britain survey shows concerns over the European financial crisis subsiding, stronger profit expectations and improvements in anticipated sales and orders.

The report, which canvassed the views of 110 north west firms, shows 42 per cent said they expect orders to increase during the first half of the year, compared to just 13 per cent thinking orders will fall.

And 44 per cent said they think sales will increase in the next six months, compared to16 per cent who expect a decline.

A third of businesses anticipated an increase in profits, while 35 per cent expect profits to stay the same and 27 percent expect a drop in profits.

Despite the generally outlook, 44 per cent of north west firms said their investment plans will stay the same over the next six months, while 21 per cent planned an increase and and 16 per cent planned to cut investment.

Two thirds of companies said they had no recruitment plans, while 22 per cent say they anticipated creating new jobs.

Leigh Taylor, regional director for Lloyds TSB commercial in the north and Midlands, said: “Businesses are clearly feeling more optimistic about Europe and, after a poor 2012, we should see more demand and orders coming through from the continent over the coming months.

“However, many firms are still cautious and are not investing in increasing their headcount or on key capital projects.”

When asked what the greatest threat to their business would be over the next six months, the most common fear – cited by 41 per cent of firms - was weaker UK demand, followed by employment and regulatory concerns which accounted for 25 per cent of responses.